Martin Lewis shares ‘only reason’ you need an ISA as he explains how to ‘earn even more’ | Personal Finance | Finance

Cash ISAs are savings accounts that people never have to pay tax on.

Since 2016 the personal savings allowance means relatively few savers actually pay tax on interest, as all basic 20 percent rate taxpayers can earn up to £1,000 in tax-free interest each year in savings (higher 40 percent taxpayers £500 in tax-free interest each year.

Fewer than one in 20 people get close to that; for everyone else there’s no practical cash ISA benefit, it explains on moneysavingexpert.com.

Instead, the interest rate is what counts, and cash ISAs usually pay less than normal savings.